Bitfinex is lying about the "hack" and I can tell you exactly what likely happened

in #news8 years ago (edited)

I traded on Bitfinex the entire halving from May until around early or mid-July, even being awake for three days in a row at one point during the Brexit trading there, so I witnessed everything.  How did I magically withdraw my funds right in the nick of time before getting goxed?  It was not luck.  I knew they were insolvent.


There will be lots of criminal investigations of what went on that will probably turn over nothing, but I can tell you right now, this is probably word for word of what happened and how I knew to withdraw my funds:



Another obvious reason they've been insolvent for a long time is, a guy I know from one of the trading channels I'm in (Expanse dev - not franko, the other one) tried to make a 100 BTC withdrawal from Finex like five days ago and what happened?  Finex canceled his withdrawal, gave him some bogus excuse, put his account on hold, and refused to let him take funds out.


Finex has also admitted to trading on their own exchange in the past.  This is literally a 100% complete recreation of MtGox all over again.

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Well, I guess that I will never see my .26 BTC and $250 USDT again. I love how all these exchanges get their cold wallets hacked. You would think brute forcing private keys was a trivial calculation. (Which it is not.)Also, I heard Bitgo is stating the problem is not on their end. How on earth did a "hacker" get a hold of "multiple user's" private keys? Especially when they were supposed to be multi-signature wallets. Does someone have a Quantum computer we know nothing about? (I'm being sarcastic here.) Oh well, glad that I didn't transfer even more coin to Bitfinex to make a few satoshis and pennies from the margin lending.

"Fool me once, shame on you; fool me twice, shame on me." Fool me three times, shame on all of us? How many times have we heard people talk about how exchanges could build public proof of reserves systems to avoid this? Why haven't we, as their customers, demanded this? I like the internal STEEM market because we can actually see what's going on. Hopefully this will be the last goxing (if that's what it turns out to be). We should demand verifiable reserves. Cryptocurrencies should not fall into the same central banker disasters of the past.

Unless you are actively trading, I do not know what is so difficult for users to just hold their own coins so that they have 100% control.

They don't even need to be technical, mobile wallets such as Airbitz, Breadwallet, and Mycelium are already super easy to use. The users would have 24/7 100% full access to their private keys. If they wanted to take a step further then they could look into hardware wallets such as Trezor and Ledger etc.

Point is, if you are heavily invested and not actively trading, why aren't you putting your coins in a Wallet where you have 100% control?

One of the their customers will report them to law enforcement for trading against their own customer flow lol.

Great article mate.
Greed strikes again. They were issuing shorts that they did not have backing for. I am currently testing out Magnr because they lend BTC to traders based on deposits made by savers. This is how I earn interest on my deposited Bitcoin while at the same time having the confidence that any BTC Magnr lends is actually backed by real BTC they have on deposit.

@marketingmonk I would be extremely careful with magnr they use the same wallet service "bitgo" as BFX, plus they were keeping customer funds at BFX. I haven't been able to withdraw from magnr in the past even small amounts like 1 BTC sometimes for up to 7 days.

the wild west comes to mind

Great observation. I knew bitfinex was shady and pulled my coins out after the last hack. I even called those scumbags out on twitter last week.https://mobile.twitter.com/domavila/status/758105629345079296

I recommend to store your coins as home. Offline in form of a hard wallet or on your own harddrive. I feel sorry for all who lost money. I know this does not help but try to think of this: money comes and money goes. It's a circle

Make an 'offline' paper wallet, then put private key or seed phrase on Cryptosteel and stash it safely. Buy popcorn. You can trade on exchanges without keeping your BTC on them for months at a time, amirite?

Sounds like speculation to me!

The beauty of the Blockchain is that people will follow the money and see where it ends up. If they really didn't have enough in their wallets to cover deposits, that should also be pretty clear.

It's good that you got your money out before the hack, but I think people often read the seemingly irrational movements of markets as manipulation by individualy, whereas that is rarely the case.

Interesting article nonetheless.

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